So confidence and courage is two must haves for a true investor.

Taking decisions – Heart instead of head

Here is an example for this: Two people went to see a beautiful house to buy. First person said, the paintings are very good and the inside arrangements are excellent. Second person was looking on the pillars and the strength of roof and walls. Here, who is really identifying the true value of this house? Of course, the later person. Why? From the view of first one, the house looks beautiful with the paint and the internal decorations used. We can beautifully paint any dirty thing and present in front of anybody. But there will not be any value or worth on that. A house should built with strong pillars, roof, walls etc to long last and receive worth to the amount what you are paying to buy the house. This is the best example for how thoughts are coming from persons. Thoughts of first person came from the heart because he saw only the external beauty of the house. Thoughts of the second person came from the brain because he saw the real strength and long lasting capacity of that building.

An investor should be like the second person. He should not commit to invest on any product by seeing the beauty and popularity of the product. But, he should use his brain to analyze and identify the worth and true value of the product. Hope you are fine with this point.

Insufficient Knowledge

Most important factor you can avoid to get huge investment failure. An investor should have enough knowledge on the once that he is going to deal with. Here is an example: You are planning to buy gold or diamond. You went to the shop with money and asked the saleswomen to show the best gold product that he want. She was giving a gold plated copper and telling you this is the best gold product. Will you buy? No. You will not. This is happening because you are aware about gold and you are aware about how identify the gold.

This is happening because you have knowledge on the product and you know the real value of copper and gold. Investment is also like that. You should have very good knowledge to each product to identify the real value. Or you will be like a person who goes with gold plated copper by thinking that it is a real gold.

Lack of analyzing capacity

This is an another important factor can lead an investor to big failure or great success. Here is an example: You are going to a super market and asking for rice. There are showing you the wheat and telling you this is rice and what you will do? Either you will hit them or will use very bad words to them. If you are blind, may be you will believe the words and buy wheat in stead of rice. But you are not blind and you have capacity to identify which is wheat and which is rice.

In the world of investment the same identification power known as analyzing power. This is the capacity to identify proper products in proper time. Suppose they have shown you the rice but that is a special one very costly at the time you went and will be less costly after some time. Will you buy that? No you will not. In stead of buying the same, you will look into some other rice which is less costly at that time.

This is the major point where most of the investors are failing. They are not able to analyze the proper product. If the found a product, they will not be able to identify the exact value of the product for today and tomorrow.

To get the proper analyzing capacity and power, you required to have lots of reference and study. An investor cannot be a successful one if he have very few knowledge or very few reference. He should have good analyzing capacity to identify the true value of the product for today and tomorrow. Or he will go like a blind person who is going with wheat and thinking that is rice.

Above are the major factors that can lead you to huge investment failures or high success. This is your time to assess yourself to identify for which group you belongs too..

Hope all of you have enjoyed this article. Inform me if you feel that I have missed any points that should be a part of this article. Your comments are very precious to me and will highly appreciate.